Just Three Days Till M.Yochananof and Sons (1988) Ltd (TLV:YHNF) Will Be Trading Ex-Dividend

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see M.Yochananof and Sons (1988) Ltd (TLV:YHNF) is about to trade ex-dividend in the next 3 days. The ex-dividend date is usually set to be two business days before the record date, which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade can take two business days or more to settle. Meaning, you will need to purchase M.Yochananof and Sons (1988)'s shares before the 7th of December to receive the dividend, which will be paid on the 15th of December.

The company's upcoming dividend is ₪1.38 a share, following on from the last 12 months, when the company distributed a total of ₪5.52 per share to shareholders. Based on the last year's worth of payments, M.Yochananof and Sons (1988) stock has a trailing yield of around 1.8% on the current share price of ₪314.50. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! As a result, readers should always check whether M.Yochananof and Sons (1988) has been able to grow its dividends, or if the dividend might be cut.

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If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. M.Yochananof and Sons (1988) is paying out an acceptable 72% of its profit, a common payout level among most companies. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. It distributed 45% of its free cash flow as dividends, a comfortable payout level for most companies.

It's positive to see that M.Yochananof and Sons (1988)'s dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.

Check out our latest analysis for M.Yochananof and Sons (1988)

Click here to see how much of its profit M.Yochananof and Sons (1988) paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Fortunately for readers, M.Yochananof and Sons (1988)'s earnings per share have been growing at 12% a year for the past five years. M.Yochananof and Sons (1988) has an average payout ratio which suggests a balance between growing earnings and rewarding shareholders. Given the quick rate of earnings per share growth and current level of payout, there may be a chance of further dividend increases in the future.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, five years ago, M.Yochananof and Sons (1988) has lifted its dividend by approximately 2.5% a year on average. Earnings per share have been growing much quicker than dividends, potentially because M.Yochananof and Sons (1988) is keeping back more of its profits to grow the business.

To Sum It Up

Has M.Yochananof and Sons (1988) got what it takes to maintain its dividend payments? We like M.Yochananof and Sons (1988)'s growing earnings per share and the fact that - while its payout ratio is around average - it paid out a lower percentage of its cash flow. It's a promising combination that should mark this company worthy of closer attention.

Keen to explore more data on M.Yochananof and Sons (1988)'s financial performance? Check out our visualisation of its historical revenue and earnings growth.

If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.